BILLINGSTAD, NORWAY -- Kitron ASA today reported strong revenue growth and the achievement of an important margin goal in the second quarter.

The EMS company's revenue in the second quarter amounted to NOK 649 million ($78.6 million), up 16% compared to 563 million in the same quarter last year. Organic growth, excluding currency factors, was up 15%. The company said higher demand in the industrial sector, while defense/aerospace and energy/telecoms also recorded solid growth.

Net profit was NOK 31.4 million ($3.8 million), an increase from 21.4 million. This corresponds to earnings per share of NOK 0.18, compared to NOK 0.12 last year.

Operating profit was NOK 45.5 million ($5.5 million), compared to 33.1 million last year, an increase of 37%. EBITDA was up 31% to NOK 59 million. EBIT margin was 7%, up 110 basis points from the second quarter of 2016. Operating cash flow was NOK 63.1 million (7.6 million), compared to 61 million last year.

The order backlog ended the quarter at NOK 1.02 billion, an increase of 3% compared to last year. Orders received in the quarter were NOK 590 million.

In a statement, CEO Peter Nilsson said, "The EBIT margin is in line with the long-term target that we presented at the Kitron Capital Markets Day in February 2016, and this is the first quarter in which we have achieved this ambition. While the margin will vary from quarter to quarter, this is an important milestone in the improvement process that has been under way the past couple of years. We also deliver on growth and capital efficiency, and at the same time we are investing in capacity and capabilities in order to improve our competitiveness further. We're seeing growth in general with our customers. Together with new business awards Kitron demonstrates stronger growth than the industry in general. The strong first six month report of 2017 presented today proves that Kitron creates value for its customers and has a strong platform for further growth."

In May, Kongsberg Defence Systems awarded Kitron a NOK 34 million order for military communications equipment. In June, Kitron signed a contract with a potential value of NOK 600 million (72.6 million) over a five-year period with Husqvarna Group. The new agreement includes five products for the Husqvarna Robotic Lawn Mowers product range and is in addition to existing manufacturing volumes.

In the second half Kitron will invest in SMT equipment for increased capacity in the US, Lithuania and China. In addition, further investments in Norway, Sweden and Lithuania will focus on automation and robotics.

Kitron guided for full-year revenue of NOK 2.15 billion to 2.35 billion ($260 million to (284 million). EBIT margin is expected to be 5.6% to 6.4%. Revenue is now expected to be in the higher end of the indicated range, driven primarily by customers in the industrial sector. The profitability increase is driven by cost reduction activities and improved efficiency.

Ed.: 1 NOK = 0.121031 USD

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